Different Saving Account with Different Provider for JENI

Question: Case Study on SavingJeni is determined to own her own home. She has just left school with 3 A levels at grade A. She has decided not to go to university because she has been accepted on a training scheme with a firm of accountants. This scheme will lead to her becoming a fully qualified accountant in 7 years. Her starting salary will be 16,000 gross per annum and will increase by 1,500 each year for 7 years provided she passes all her exams. Jenis parents have suggested that she lives with them until she is fully qualified and will not take any money from her provided she agrees to save half of her net pay towards a deposit on her own house. Suggest 3 different savings accounts (with 3 different providers) that Jeni could use to save for the next 7 years and provide relevant details in the form of a table. The table should include the name of each provider, a brief description of each product and its key features, and any other details which help distinguish it from the other product s included. Use calculations to estimate how much Jeni might be able to save and demonstrate how her savings might grow using the 3 different accounts chosen in part a. Compare the 3 alternatives, discuss any non-financial considerations that might affect Jenis choice and make recommendations on how Jeni should save. Answer: Introduction Financial services upkeep the economy and offer vital credit to families, client and occupational or business. We are building an agenda that stimulates an accountable and supportable financial service business, undertaking the problems of competition and danger or risk in the banking region.Saving account basically maintained by trade financial associations that pay interest then again it cannot be cast-off openly as money in the tapered logic of a medium of exchange. There are different types of savings account in UK for every people. They can save on a regular basis, on notice saving account, fixed bond maturity saving account as well as individual saving account. All saving account has different features. They have some merits and demerits too. Different Saving Account with Different Provider for JENI Regular saving accounts at HALIFAX Notice saving account at Chartered saving account Cash ISAs account at Airdrie Saving Bank These accounts are generally required by client to credit money each month, short of be unsuccessful so people are best for collectors who are preparatory out or who request to leak nourish cash into account in a well-organized system. This type accounts work in diverse manner to immediate access deals. As Jeni want to save for 7 years and she dont want to access quickly. This saving account is tax free from earning interest. As Jeni is looking for home it will help her ISAS means individual saving account. It has limitation of withdrawals in each year. It cannot for emergency withdrawals. But in this bank there is no withdrawal facility within 12 month. If want to withdraw, in advance you have to tell the provider. This bank allows people to invest 1 minimum for opening the account. It is restrict towards investing more than assured amount each month. It prevent you from insertion extra money in account if it go well with you. Notice period should be 30,60 or 90 days according to this you have to plan prior for withdrawing cash. It has variable rate but tax free. This bank not provides you any bonus. Any emergency withdrawal within notice period might you lose some interest. It is available for the 16 year old or more than 16. There is fixed interest rate. i.e. 2% There is variable interest rate. The gross amount will get after deducting income tax. It is transferable account. Means from one ISAs to any other ISAs account You can access your account online to see your balance in the bank branch. Minimum amount 1000 in year. Below this amount bank will reduce interest rate Payment of cash can be at any time in the year Your account will transfer into saving bank account after 12 month of investment. There is also not providing any bonus. It can be monthly or lump sum payment Jeni can start investing in saving account from 25 to 230 per month or lump sum amount in a year. Jeni can save on lump sum basis. Saving is tax free. Features of Saving Bank Account Regular saving account: - In this account people can save on regular basis each month. They can start saving in lump sum basis also This account can transfer to other saving account after 12 month. There is fixed interest rate Limits on withdrawal, are not tax free Notice saving account: - Minimum amount have to maintain. Withdrawal is allowed after notice period i.e. 30,60 or 90 days Interest amount reduced when withdrawal is happen before notice period. Variable interest rate and lump sum amount can pay each year. Cash ISAs: - It is tax free on interest and saving Variable rate of interest Monthly or lump sum amount can save. Min balance 1 apart from other saving accounts. 1 Calculation for interest saving by regular saving Jeni spend Half amount 16000/2= 8000 If she pays 2000 in a year @ of 4% without additional 1500 which she will get every year? She will get interest of 631.86 so total amount in the year become 2631.86. 2 Calculation for notice saving account: If jeni will pay 2000 in year in notice account every year with variable interest rate of 4.5 % and deposit every month 200 she will earn 22443.02 because it is compounded on yearly basis. 3 calculations for fixed individual saving account (ISAs) Jeni will pay 2000 for fixed ISAs @ 8% than she will get 3173.75 per year. According to me I suggest to invest in notice account because it will give her more return than Other savings account. Because access account will give you cash quickly when you needed. For notice saving account Jeni will pay lump sum amount every year. In Regular saving computation it presumes lodgments go into it which is prepared on the 1st day of every month. Interest rate and gross interest return account shows calculation of bonus and it is assume that it is invested lump sum every calendar year. Non Banking Financial Services It is that company which is listed under the company Act, 1956. They are mainly affianced in the dealing of acquisition and merger of bonds, share, debenture and securities and in loans and advances by marketable securities such as hire and purchase etc. or issued by the local authority or government. It consists of various intermediaries in financial sector. They can invest in mutual funds, pension funds as well as hedge fund and so on and there is also risk transfer individual like insurance company which assured people to give certain amount as per the circumstances. Jeni can also invest in government bond because it will give fixed return and also risk free. These bonds are basically issued by government to maintain government spending in domestic currency. There are different types of government securities like treasury bills; commercial paper etc. bond has maturity date from 1 to 30 years. And Jeni can invest in intermediate bond; its maturity period is 3 to 10 years. References Chartersavingsbank.co.uk, (2015).Charter Savings Bank. [online] Available at: https://www.chartersavingsbank.co.uk/Products/NoticeAccount [Accessed 21 May 2015]. Halifax.co.uk, (2015).Halifax UK | Savings Accounts | Regular Saving Account. [online] Available at: https://www.halifax.co.uk/savings/accounts/regular-saver/ [Accessed 21 May 2015]. key features documents of notice account. (2015). 1st ed. [ebook] Available at: https://pdf.chartersavingsbank.co.uk/kpd/keyproductfeatures-na00000017.pdf [Accessed 21 May 2015]. Key.com, (2015).Bonds: Bond Features, Benefits and Types of Bonds. [online] Available at: https://www.key.com/html/bond-investing-benefits.html [Accessed 21 May 2015]. Mybanktracker.com, (2015).Compare the Top Savings Rates. [online] Available at: https://www.mybanktracker.com/compare-savings-rates?ZoneID=Quick_LinksProductID=Savings-Savings_Accountsutm_expid=8709804-38.TF7hGNVeSIOf69bUJnXqAw.0utm_referrer=http%3A%2F%2Fwww.mybanktracker.com%2Fbanks [Accessed 21 May 2015]. Permanenttsb.ie, (2015).Compare Saving and Deposit Accounts | Savings Deposit Accounts | permanent tsb. [online] Available at: https://www.permanenttsb.ie/whatweoffer/savings-and-investing/compare-deposit-savings-accounts/#results_all [Accessed 21 May 2015]. Singh, D. (2007).Banking regulation of UK and US financial markets. Aldershot: Ashgate. Which.co.uk, (2015).The different types of savings account - Finding the best savings account - Savings investments - Which? Money. [online] Available at: https://www.which.co.uk/money/savings-and-investments/guides/finding-the-best-savings-account/the-different-types-of-savings-account/ [Accessed 21 May 2015].